Thanks for your robust reply, upvoted.

I take your point about the author/curator split, admittedly I'm not sure how that works, and there may be reasons why the effective split deviates from an economic optimum. However, just from the hearing 'reverse auction', it sounds like market forces are dictating the rate to be what it is, which at least at a cursory glance would seem fair. But there may be more to this, thanks for alerting me to this issue.

The interest (I don't think just because it doesn't beat inflation doesn't disqualifies it from the term, but that's semantics) may serve merely to mitigate some of the effects of inflation. If we're completely unable to agree on how the 15% should be spent, a common denominator would be to deduct 15% from the inflation rate and remove this part entirely. This would effectively have almost no change but makes the numbers on the books a lot clearer by removing an extra layer of market analysis and thereby improving efficiency in arriving to a more accurate overall price equilibrium.

It may be true that some believe there is insufficient incentive to hold voting power and removing this 1.5%pa will, however little, reduce that incentive even more. I am not disputing that, but I wish to point out that the 'however little' part is very important. The question is: is the marginal extra incentive of holding SP gained by this interest payment sufficient to cover its cost of 15% of the new steem created? How many people are right at the razor's edge between holding and selling where a yearly interest payment of about 1/4 of the daily volatility of the underlying asset is likely going to shift their view one way or the other? I honestly don't believe that number will justify a cost of, as of now, $900,000 a year or so. Having 1 person with a million dollars, or 100 people with $10,000, or 100 million people are all examples of of a distribution of a million dollars, but they represent vastly different utility values. The form of distribution in the interest payment in question, I feel, represents a sub optimal utility value to say the least. To surmise it as 'there is insufficient incentive to hold SP as it is, reducing it further would just make it worse' is not quite getting the point.

I happen to agree that there exists insufficient reasons to hold SP right now. My personal belief is that this is an incentive that has to arise organically from the desire and willingness to partake in a robust platform or ecosystem of platforms. The bigger and better Steemit, Squeak, Steepshot, Busy, etc are, the more people will naturally be incentivized to take part and have a voice by building up voting power. The wealth redistribution in our ecosystem should center around only directly rewarding the production and discovery of the best content, as well as the maintenance and development of the platform/s. Any other incentives such as directly attempting to bribe people into holding voting power via any means without otherwise contributing is introducing an element of inefficiency into the ecosystem that is economically guaranteed to be a deleterious impact. Even if I am wrong about this paragraph, or if you disagree with me here, it doesn't invalidate the previous paragraph.

Finally, if you read my piece and are not convinced that Steemit Inc should receive more funding I can understand. They certainly didn't ask for it and I'm not affiliated in any way. Out of a decentralized currency, decentralized distribution, and decentralized development, I think the first 2 are good but the last part is not very competitive compared to established businesses. It is overall a difficult balancing act to get right.

Thank you again, for your reply, especially about educating me on how the authorship/curation split works (which I shall look into). That's a separate issue, and I may well agree with you there after researching it.